Bank Sees Healthy Economic Growth

Press, Volume CX, Issue 32194, 13 January 1970, Page 12

Bank Sees Healthy Economic Growth

Healthy growth of the New Zealand economy during 1970 is predicted by the Australia and New Zealand Bank in the January issue of its “Quarterly Survey.”

In an article discussing the present outlook the bank says that sustained external trading surpluses in 1969 had provided a sound basis for growth during 1970.

“Business confidence continues to run at a high level and, with improved incomes, has generated greater output and consumer expenditure, particularly during the latter half of 1969. “Externally, the maintenance of the nation’s international reserves and capacity to service external debt commitments, assume the utmost future importance.” The bank continues “hopes are that any shortfall in wool’s 1970 export performance will be more than compensated by improved export income from other sources. Meat export receipts show continued growth, and all sections of the community must applaud the efforts of meat production and marketing interests responsible for organising their industry to take advantage of high seasonal prices on oversea markets, hence contributing significantly to maximising exchange earnings.” “Further growth of New Zealand’s less traditional exports, particularly manufactures and forest products, are of vital importance for New Zealand’s continuing development in 1970.

“The privately proposed New Zealand Export Corporation will supplement the large body of expertise in the export trade built up by the trading banks over many years, and can also be expected to emphasise the need

for thorough analysis of markets, as a sound basis for export promotion,” says the bank. “A trend towards an increasing proportion of capital goods among imports augers well for the future productive capacity of the economy. “The severe labour shortage is a restraint on the immediate realisation of the production potential.” The bank concludes ‘increasingly vocal claims by industry, that competitive benefits conferred on New Zealand manufacturing by devaluation are being dissipated by local cost rises, cannot be allowed to go unheeded if local products are to continue to be competitive in external markets. “Recognition of the claims of the private sector to relatively cheap finance through the banking system should be a high priority consideration of policy makers 'in the coming year.” In a further article entitled “Research and Development in New Zealand,” the bank states that the value to be derived from research, particularly that which is production orientated, was already evident in New Zealand. Continuing competitiveness of agricultural exports and the economic viability of farm units can be attributed in part to the development and application of scientific

farming techniques appropriate to the New Zealand farming environment “In the public sector, the need to carry out more challenging public works, particularly road construction and geothermal electricity, is prominent among the factors generating advanced research and development activity. In industry, the export drive, establishment of new industries and mineral exploration have increased the demand for quality control, measuring techniques, geological information and new production methods,” the article said.

More Containers Overseas Containers, Ltd. of London, is giving urgent consideration to increasing the container capacity of its ships on the Australia run, according to its deputy chairman (Mr R. O. C. Swayne). This followed the big success of the container service since it started last April, he said in an interview with the “Journal of Commerce.” O.C.L. had decided to increase the capacity from 1400 to 1500 containers.